The World Bank says it has uncovered no misuse of its funds by Vietnam's Transportation Ministry and the Asian Development Bank says it is satisfied with Vietnam's efforts to fight corruption. Matt Steinglass reports for VOA from Hanoi.

A cloud has been hanging over Vietnam's infrastructure sector for a year, since it was discovered that tens of millions of dollars had been misspent by a Transportation Ministry contracting unit called PMU-18. In some cases, money had disappeared; in others, projects had been poorly built.

The scandal raised fears that aid from international donors might have been stolen. The World Bank sent investigators to determine whether any of its money had been misused.

The bank's vice president for East Asia and the Pacific, Jim Adams, says it had not. "In the World Bank, we have a group that came out to work with the government doing a review of what has happened, and I am pleased to report that their investigation did not reveal any indications of funds being misused."

The World Bank says it will lend Vietnam $800 million per year, interest free, for the next five years. Much of the money will go for improvements in the country's transportation and energy infrastructure.

Vietnam's other major multi-lateral aid donor is the Asian Development Bank.

In December the ADB announced more than $1 billion in new loans to Vietnam for massive infrastructure projects, including the planned subway in Ho Chi Minh City and several large dams.

In an interview in Hanoi, the ADB's Vice President for Operations, Larry Greenwood, said he is confident none of the bank's money had been misspent in Vietnam. He the ADB's own anti-corruption investigation was only part of the response. "The more interesting issue is the very robust response of the government. They essentially have come to us and explained how they are dealing with this," he said.

Vietnam arrested a number of senior officials in the PMU-18 case, including one who had bet more than two-million dollars on European soccer matches. The Minister of Transportation was forced to resign, and a deputy minister was charged last month with tax fraud and three other counts.

Vietnam passed a new corruption law last year, and set up a high-level national Corruption Committee.

But the Vietnamese transportation sector continues to produce new scandals. Last month, government inspectors found $2.3 million had been wasted in a port expansion project in northern Vietnam.

The ADB's Greenwood said that projects funded by multi-lateral donors generally have tighter accounting rules than governments. "I do not know about Vietnam, but it is certainly the case in a number of countries that they use multilateral development banks just to be able to get around those kinds of problems. Because they know that the corruption is rife, and they also know that the MDBs have a zero tolerance, and have these more stringent accounting procedures," he said.

Greenwood said the ADB hopes that such rules will serve as an example for developing countries plagued by corruption.